According to a report, India is ranked as the country with the lowest production cost, beating out China and Vietnam.
India, Vietnam, Thailand, and other countries create more favorable conditions for doing business than manufacturing partners in China. According to US News and World Report, India is ranked 31st in the overall best country ranking out of 85 countries.
This report evaluates 85 countries on 73 parameters. Attributes are grouped into 10 subcategories, including adventure, dexterity, entrepreneurship, openness to business, social goals, and quality of life.
In the Open for Business subcategory, India scored 100% in terms of lower production costs. However, in “a favorable tax environment,” it received a score of 16.2 out of 100. 18.1 in the “Lack of Corruption” category and 3.5 in the “Transparent Public Policy” category.
Similarly, in the “Quality of Life” category, India scored 1.9 in “Income Equality”. 4.3 “Safety”; 2.3 “Advanced Healthcare System”; and 9.9 “economically stable” subdimensions.
The government has taken steps such as introducing manufacturing-related incentives and reducing the burden of complying to make India a global manufacturing hub.
Apple, Hasbro, and Black & Decker are just a few of the well-known companies moving from China in search of manufacturing opportunities elsewhere. Intel is also considering a similar move, and other deviations are likely.
In the meantime, India must do its best to reinvest in its people and workforce. They should focus on innovation channels such as education and infrastructure to encourage foreign investment.
